Condo Q&A: Facts about mediation, arbitration

Question: What is the difference between mediation and arbitration and is it true that I have to take part in mediation or arbitration before I can sue my condominium association?

- A.T.

Poliakoffs: Mediation and arbitration are both forms of alternative dispute resolution (ADR) - ways that a dispute between parties can be solved without resorting to costly litigation. Before we address the specifics of how ADR works in condominiums, it would be helpful to explain the difference between mediation, arbitration and lawsuits.

Obviously, the first form of "dispute resolution" is to try and handle disputes directly, by having an open discussion between the two parties.

Assuming that the direct method hasn't worked, the next and least aggressive form of ADR is mediation. A mediation (which can be either mandatory or voluntary) occurs when the two parties sit down, usually with their attorneys, in front of a trained mediator. A mediator's job is to help the two sides air their grievances in a productive manner. Mediators are not judges - they do not decide what is right or wrong, or what the true facts of the dispute are. Instead, mediators assist parties in reaching their own bargain, usually by serving as a shuttle between the two sides as they negotiate settlement terms. Mediations are non-binding, unless the parties sign a settlement agreement at the end of the process.

In an arbitration, an arbitrator will serve as a private judge who will determine which side is "right" and wins the dispute. Both sides will present facts to the arbitrator (usually through attorneys, just as in a courtroom). Witnesses may be interviewed, and documents reviewed. Eventually the arbitrator will come to a conclusion of fact, just like a judge, and award relief to one or the other party. Arbitrations can be either binding or non-binding.

Last, of course, is litigation, where a dispute is brought in a state or federal courtroom where judges or juries are presented facts (by attorneys, in large disputes) and render a decision that is binding on the parties and may only be appealed if there is an argument over an issue of law.

Now, in the condominium arena, mediation is optional across the board. Arbitration is mandated whenever there is a disagreement between two or more parties that involves either:

(a) the authority of the board of directors, under the Condominium Act or condominium documents, to require any owner to take any action, or not to take any action, involving the owner's unit or the appurtenances thereto; or to alter or add to a common area or element; or

(b) the failure of a governing body, when required by the Act or condominium documents, to properly conduct elections, give adequate notice of meetings or other actions, properly conduct meetings, or allow inspection of books and records.

Expressly excepted from the requirement of non-binding arbitration are any disagreements that primarily involve title to any unit or common element, the interpretation or enforcement of any warranty, the levy of a fee or assessment, the collection of an assessment, the eviction or the removal of a tenant from a unit, alleged breaches of fiduciary duty by one or more directors, or claims for damages to a unit based upon the alleged failure of the association to maintain the common elements or condominium property.

So the short answer is that mediation is optional, but highly encouraged.

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

Email this article

Condo Q&A: Facts about mediation, arbitration

Question: What is the difference between mediation and arbitration and is it true that I have to take part in mediation or arbitration before I can sue my condominium association? ? A.T.